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Advertisers, marketers, brands and social media platforms will face scrutiny as Australia’s competition watchdog investigates advertising fraud by social media influencers.
The Australian Competition and Consumer Commission (ACCC) has launched a sweep to identify misleading testimonials and endorsements by over 100 social media influencers.
Watchdog not only researches influencers, but also various social media platforms such as Instagram, TikTok, Snapchat, YouTube, Facebook and Twitch.
The ACCC also considers the role of other parties that facilitate fraud, including advertisers, marketers, brands and social media platforms.
The sweep covers sectors where influencer marketing is prevalent, including fashion, beauty and cosmetics, food and beverage, travel, health fitness and wellbeing, parenting, gaming and technology.
ACCC Chair Gina Cass-Gottlieb said:
“It is important for social media influencers to be clear about whether there is a commercial motive behind their posts. The ACCC will not hesitate to take action if it determines that a consumer is at risk of being misled or deceived by testimony and serious harm may result.
“This action may include compliance, education, and follow-up of misconduct through potential enforcement activity.”
According to the ACCC, many consumers are aware that influencers receive financial payments and incentives to promote their products and services, but disclosing these relationships is not always obvious. .
“The ACCC is concerned that influencers, advertisers and brands are trying to hide this fact from consumers, thus preventing them from making informed choices. This can be especially true for micro-influencers who have a small following, as they can be maintained over time, adding legitimacy to ad posts hidden with their followers, according to the organization’s statement.
ACCC’s sweeps monitor influencers large and small, with over 150 submissions from the public.
“The number of information offerings continues to grow in the number of manipulative marketing techniques on social media designed to exploit consumers or pressure them to purchase goods and services. It reflects community concerns about
“We are already hearing that several law firms and industry groups are informing clients about the ACCC sweep and reminding them of their advertising disclosure requirements,” said Cass-Gottlieb.
The crackdown is part of the competition watchdog’s efforts to identify deceptive marketing practices across the digital economy. This comes ahead of an interim report to Australia’s Digital Platform Services, which is expected to be released in March.
This report contains Watchdog’s findings and recommendations for social media services, including influencer advertising practices and sponsored posts.
This follows a move by advertising bodies around the world to increase transparency across social media platforms.
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